Walgreens' Private-label Offerings Grow

Posted: March 17, 2008

As part of a larger evaluation of its private label offerings, Walgreens expects the rollout of its W label of approximately 800 commodity items (such as shampoo and baby lotion) to be complete by fall, according to The Chicago Tribune. The brand launched in January, and the company spent three years interviewing and surveying consumers about its private-label brands. The Tribune reports that more than 4,000 consumers participated in market research on the "W" packaging alone.

"When you look at what's going on in national brands, margins are very, very tight and national brand pricing is increasingly tight," David VanHowe, vice president of purchasing, said in an interview at Walgreens headquarters in Deerfield. "This is a way to differentiate yourself and improve profit margins."

Walgreens' private-label business accounts for approximately 20% of general merchandise sales, up from 12% in 2000.

"We took a really in-depth look at our private-label business," said Kristen Abreu, director of private brands, Walgreens. "We left the Walgreens name on all our health-care products. But the name Walgreens didn't mean as much in the sundries category."